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Wednesday, 12 October 11
CAPESIZE FREIGHT RATES BOUND TO RETREAT FROM 2011 HIGHS ON THE BACK OF TONNAGE OVERSUPPLY SAYS BIMCO
 According to Nikos Roussanoglou, Hellenic Shipping, with the BDI (Baltic Dry Index) breaking yet another 2011 high yesterday and ending the session at 2,106 points, up by 3.64% on the day, dry bulk ship owners couldn’t be happier. But, as BIMCO’s senior analyst Peter Sand notes, this recent positive development is not rooted in an improved fundamental balance between supply and demand. Thus, it’s likely to see an easing of rates from current levels. “Despite the traditionally strong fourth quarter we estimate that the Capesize Time Charter Average will travel southbound from current highs towards the USD 15,000-20,000 per day as the tonnage oversupply is bound to rule again. Amongst the smaller ship sizes, Panamax and Supramax rates are likely to stay firm in the USD 14,000-18,000 per day. Handysize rates are expected in the USD 10,000-14,000 per day interval” said BIMCO.
The organization forecasts a total delivery of more than 90 million DWT of newbuild dry bulk vessels in 2011. “This will result in a fleet growth of over 14%. Deliveries are biased towards the larger segments, but so is scrapping of over-aged tonnage. It is also worth noticing that conversion of single-hull VLCCs into Very Large Ore Carriers for the last year this time around is expected to push up fleet growth by 3 million DWT.
China is on course to deliver iron ore demand growth of 10%, being more or less the single positive iron ore story in 2011. Regardless of the recent Bull Run in Capesize freight rates, second hand values have continuously leaked. This is supporting the argument of a temporary event. But as spot rates have picked up, so have short-term time charters. Six month time charter rates have doubled since the beginning of August while 1 year charter rates have jumped by 50%. The long end of the forward curve remains unaffected” said BIMCO in its analysis.
Demand-wise BIMCO’s Peter Sand said that “The positive development in Capesize freight rates seen since 22 August, when the USD 16,000 per day lid was blown off, also took the BIMCO Capesize time charter earnings forecast by surprise while the remaining segment earnings forecast were spot on. The Capesize segment has sprinted away from the rest of the field into a break-away that is still rolling. Freight rates for Capesize vessels started to rise on the back of stronger Chinese demand for coal and iron ore. As India is still a reluctant exporter of iron ore, stronger demand resulted in more tonnes-miles as Brazil and Australia pitched in as the swing-providers of this vital steel-ingredient to Chinese steel mills. This boosted Capesize demand at the expense of Supramax demand, which normally lifts Indian iron ore to China. Overall development on the dry bulk markets, as expressed by the BDI, has gained 413 index points since 22 August – equal to 27%.
Over the same period of time, Capesize earnings have gained 74% and this compares to moderate earning gains in the smaller segments. Last year, seaborne iron ore demand grew by 10.6% driven by resumed demand from Europe and Japan following the fall-out in 2009. In 2011, iron ore demand growth is seen only in China but as long as it maintains an insatiable iron ore hunger, Capesize vessels are hanging on. However, at a growth rate of just 6% expected in 2011, demand will be the poorest in the past 10 years. Total coal demand is set to grow by just 2% this year as compared to 15.9% in 2010. This does not bode well for overall Capesize demand as the fleet grew by 23% last year and is on course for 13.4% growth this year (depending on level of recycling, scrap steel demand and freight rate development). The current spike in freight rates, suggested to be due to strong Chinese demand for coal and iron ore in a combination with available tonnage imbalance between the basins, seems fundamentally difficult to maintain as overall available tonnage remains abundant” said BIMCO.
As far as supply goes “the active fleet has grown by 10.1% so far in 2011, caused by delivery of 64.2 million DWT, offset by 18.1 million DWT being demolished. According to BIMCO estimates, the fleet is about to grow by 14.5%, unless planned deliveries are postponed beyond what is already assumed.
“Demolition of older tonnage is estimated at 20 million DWT, but could go as high as 25 million if year-to-date demolition swiftness continues. However, the recent jump in Capesize earnings could prove “sufficient” to cool down the rush to the breakers. 55% of all demolished tonnage has originated from Capesize vessels and that has positively reduced the net fleet growth by 4.4% so far. The Capesize fleet would have grown by 20% in 2011 without any demolition activity at all, but holds now the potential of growth by just 13.4%.
The Handysize segment, which saw 6.7% of the fleet during 2009 and another 3.0% during 2010 being removed due to strong demolition, is once again enjoying a noteworthy amount of 2.5 million DWT scrapped so far in 2011 with a clear potential for more to come. While Handysize are currently scrapped at an average age of 33 years, Capesize vessels are broken up at an average age of 27 years. New orders continue to be placed at slower pace than new ships are delivered, bringing the orderbook down from 241 million DWT two months ago to 236.6 million DWT. The orderbook-to-fleet ratio remains very high at 40.5% as the active fleet has reached 583.8 million DWT. Put into perspective of the amount of new built tonnage delivered in previous years, 2011 represents Mount Everest and 2010-2013 deliveries the Himalaya mountain range” concluded the analysis.
Source: Nikos Roussanoglou, Hellenic Shipping
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Tuesday, 06 September 11
SEMEN GRESIK TO ACQUIRE COAL MINE FOR RP. 1 TRILLION
COALspot.com - PT Semen Gresik Tbk (SMGR) is planning to acquire a low calorific value coal concession (IUP). According to Semen Gresik, the coal mi ...
Tuesday, 06 September 11
DRY BULK MARKETS RALLY POWERS THROUGH TO NEW WEEK, BUT A CORRECTION COULD BE OVERDUE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market’s freights rates kept leaping forwards during the beginning of the week, with the industry’s benchmark, the Baltic D ...
Monday, 05 September 11
TNPL POSTPONES BID OPENING UNTIL 12 SEPTEMBER 2011
COALspot.com - TNPL has postponed submission of the offer until 12 September 2011 on request from the supplier, an Indian trader said.
Due to Ram ...
Monday, 05 September 11
INDONESIAN COAL BENCHMARK PRICE - ANALYSIS
Analyst : Sunil K Kumbhat
COALspot.com - As a part of the Government’s efforts to stop transfer pricing abuses which have resulted in the los ...
Saturday, 03 September 11
FEW SHIPS REPORTED FIXED FROM INDONESIA TO INDIA - VISTAAR
COALspot.com - The freight market continued the upward trend during last week with BDI up by about 13 pct closing at 1,740 points and cape index up ...
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- Bhatia International Limited - India
- Parry Sugars Refinery, India
- Sarangani Energy Corporation, Philippines
- Planning Commission, India
- Straits Asia Resources Limited - Singapore
- Bukit Baiduri Energy - Indonesia
- Borneo Indobara - Indonesia
- Marubeni Corporation - India
- Wood Mackenzie - Singapore
- Global Green Power PLC Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Heidelberg Cement - Germany
- Tata Chemicals Ltd - India
- Timah Investasi Mineral - Indoneisa
- Minerals Council of Australia
- Semirara Mining and Power Corporation, Philippines
- Xindia Steels Limited - India
- Kartika Selabumi Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Vedanta Resources Plc - India
- PowerSource Philippines DevCo
- Price Waterhouse Coopers - Russia
- Holcim Trading Pte Ltd - Singapore
- SMG Consultants - Indonesia
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- White Energy Company Limited
- Jindal Steel & Power Ltd - India
- Ministry of Transport, Egypt
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- Aboitiz Power Corporation - Philippines
- Global Business Power Corporation, Philippines
- Central Electricity Authority - India
- London Commodity Brokers - England
- Therma Luzon, Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Carbofer General Trading SA - India
- Eastern Coal Council - USA
- Rashtriya Ispat Nigam Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Deloitte Consulting - India
- Karbindo Abesyapradhi - Indoneisa
- Jaiprakash Power Ventures ltd
- Interocean Group of Companies - India
- OPG Power Generation Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Thai Mozambique Logistica
- Bank of Tokyo Mitsubishi UFJ Ltd
- Krishnapatnam Port Company Ltd. - India
- Coal and Oil Company - UAE
- Semirara Mining Corp, Philippines
- Attock Cement Pakistan Limited
- Kideco Jaya Agung - Indonesia
- Romanian Commodities Exchange
- Gujarat Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- Anglo American - United Kingdom
- Posco Energy - South Korea
- Ministry of Mines - Canada
- Bayan Resources Tbk. - Indonesia
- Bhoruka Overseas - Indonesia
- Economic Council, Georgia
- Orica Australia Pty. Ltd.
- Medco Energi Mining Internasional
- Manunggal Multi Energi - Indonesia
- Grasim Industreis Ltd - India
- Iligan Light & Power Inc, Philippines
- Orica Mining Services - Indonesia
- Merrill Lynch Commodities Europe
- Salva Resources Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Indian Oil Corporation Limited
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Cement Manufacturers Association - India
- Chettinad Cement Corporation Ltd - India
- Africa Commodities Group - South Africa
- Australian Coal Association
- Altura Mining Limited, Indonesia
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- GVK Power & Infra Limited - India
- Vizag Seaport Private Limited - India
- Directorate Of Revenue Intelligence - India
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Thiess Contractors Indonesia
- Indika Energy - Indonesia
- Georgia Ports Authority, United States
- Bhushan Steel Limited - India
- Aditya Birla Group - India
- Asmin Koalindo Tuhup - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Rio Tinto Coal - Australia
- The University of Queensland
- Kumho Petrochemical, South Korea
- Toyota Tsusho Corporation, Japan
- Latin American Coal - Colombia
- Ceylon Electricity Board - Sri Lanka
- San Jose City I Power Corp, Philippines
- MS Steel International - UAE
- Samtan Co., Ltd - South Korea
- Sical Logistics Limited - India
- Chamber of Mines of South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Simpson Spence & Young - Indonesia
- TeaM Sual Corporation - Philippines
- Agrawal Coal Company - India
- Ambuja Cements Ltd - India
- ICICI Bank Limited - India
- Commonwealth Bank - Australia
- Indogreen Group - Indonesia
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- Siam City Cement PLC, Thailand
- Coalindo Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Standard Chartered Bank - UAE
- Antam Resourcindo - Indonesia
- Oldendorff Carriers - Singapore
- Singapore Mercantile Exchange
- Indonesian Coal Mining Association
- Coastal Gujarat Power Limited - India
- The Treasury - Australian Government
- Madhucon Powers Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ind-Barath Power Infra Limited - India
- Eastern Energy - Thailand
- Independent Power Producers Association of India
- Edison Trading Spa - Italy
- AsiaOL BioFuels Corp., Philippines
- Siam City Cement - Thailand
- SN Aboitiz Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Central Java Power - Indonesia
- Barasentosa Lestari - Indonesia
- Sakthi Sugars Limited - India
- Lanco Infratech Ltd - India
- ASAPP Information Group - India
- Uttam Galva Steels Limited - India
- Savvy Resources Ltd - HongKong
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- Bukit Makmur.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- Mintek Dendrill Indonesia
- Kohat Cement Company Ltd. - Pakistan
- VISA Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- Parliament of New Zealand
- Dalmia Cement Bharat India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Sidhee Cement - India
- SMC Global Power, Philippines
- Mercator Lines Limited - India
- India Bulls Power Limited - India
- CNBM International Corporation - China
- Bangladesh Power Developement Board
- Maharashtra Electricity Regulatory Commission - India
- CIMB Investment Bank - Malaysia
- Kobexindo Tractors - Indoneisa
- Sindya Power Generating Company Private Ltd
- Jorong Barutama Greston.PT - Indonesia
- Trasteel International SA, Italy
- Larsen & Toubro Limited - India
- Tamil Nadu electricity Board
- Indian Energy Exchange, India
- PNOC Exploration Corporation - Philippines
- Makarim & Taira - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Wilmar Investment Holdings
- Kaltim Prima Coal - Indonesia
- IEA Clean Coal Centre - UK
- Miang Besar Coal Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Formosa Plastics Group - Taiwan
- Ministry of Finance - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Electricity Authority, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- Petron Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Kapuas Tunggal Persada - Indonesia
- Energy Development Corp, Philippines
- Meenaskhi Energy Private Limited - India
- LBH Netherlands Bv - Netherlands
- European Bulk Services B.V. - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Intertek Mineral Services - Indonesia
- Mercuria Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Gujarat Mineral Development Corp Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Star Paper Mills Limited - India
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Energy Link Ltd, New Zealand
- Global Coal Blending Company Limited - Australia
- Sojitz Corporation - Japan
- Malabar Cements Ltd - India
- GMR Energy Limited - India
- Karaikal Port Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- PTC India Limited - India
- Mjunction Services Limited - India
- South Luzon Thermal Energy Corporation
- The State Trading Corporation of India Ltd
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